Biogen, Elan Again Boost Prices Of MS Treatments
20 Janvier 2011 - 9:07PM
Dow Jones News
Biogen Idec Inc. (BIIB) increased the wholesale price of popular
multiple-sclerosis drug Avonex by 6% last month, while Ireland's
Elan Corp. (ELN, ELN.DB) gave a 7% boost to the price of MS therapy
Tysabri, which it sells with Biogen.
The two blockbuster drugs make up the majority of Biogen's
revenue and the price growth continues the trend of aggressive
increases for drugs that treat the debilitating disease. The moves
are the second increases for both drugs in the past eight
months.
A Biogen spokeswoman declined to provide a reason for the move,
saying that the company doesn't comment on its pricing strategy. An
Elan spokesman said the Tysabri price increase "took into account
multiple factors, including patient access, the reimbursement and
the competitive pricing environments."
Biogen is in the midst of a restructuring that includes a focus
on developing treatments for neurology and increasing sales of the
existing MS treatments. Last year, the company completed the
expansion of the Avonex sales force, along with other initiatives
to reinvigorate U.S. sales of the drug, which was launched in
1996.
UnitedHealth Group Inc. (UNH) said in November that the prices
for MS drugs have risen by 65% over the past three years. With the
increases, the annual price of Avonex now stands at about $37,500
and Tysabri is $42,800, according to spokespeople from the
companies.
Shares of Biogen recently rose 3.2% to $68.37, while American
depositary shares of Elan fell 1.2% to $6.43.
Tysabri is Elan's biggest seller, although it is important to
the future of both companies. Revenue from Avonex and Tysabri made
up about 70% of Biogen's total of $4.4 billion in 2009.
Avonex is popular for initial treatment of the disease, while
Tysabri is generally given to patients who don't respond to earlier
therapy or have an aggressive form of MS.
In June, Elan increased Tysabri's price by 18.7%, marking the
most aggressive increase since the drug's approval in 2004. Under
their collaboration, Elan sets the price of Tysabri. The drug had
global sales of $1.1 billion in 2009.
Tysabri's sales growth has been weaker than originally expected
because of the drug's continued link to a rare brain infection
called PML that led to its temporary market withdrawal in 2005.
For Avonex, price increases have aided sales growth as the
number of new patients using the drug stagnated and competition
increased across the market for MS treatments.
Lazard Capital Markets recently noted that Biogen last increased
the price of Avonex by 4.5% in the third quarter and 5.5% last
February, moves that followed three 9% price increases in 2009. A
Biogen spokeswoman declined to confirm those price moves, citing
policy.
The price increases in recent years have come with similar moves
for other MS drugs including Teva Pharmaceuticals Industries Ltd.'s
(TEVA, TEVA.TV) Copaxone, and Rebif, which is marketed by Pfizer
Inc. (PFE) and Germany's Merck KGaA (MKGAY, MRK.XE). Late last
year, Novartis AG (NVS, NOVN.VX) priced Gilenya, the first daily
pill for MS, at $48,000 a year.
Biogen is in the midst of a restructuring that includes a focus
on developing treatments for neurology and increasing sales of the
existing MS treatments. Last year, the company completed the
expansion of the Avonex sales force, along with other initiatives
to reinvigorate U.S. sales of the drug, which was launched in
1996.
Last month, Biogen Chief Executive George Scangos downplayed the
importance of price increases for the drugs. In an interview, he
said there wasn't "a huge amount of room" for further
increases.
"As we think about our planning, we think about market share and
units and how do we compete effectively against the other drugs
that are on the market, and less about what upside value we have in
price increases," said Scangos.
-By Thomas Gryta, Dow Jones Newswires; 212-416-2169;
thomas.gryta@dowjones.com